Farok J. Contractor, Ph.D., Outgoing President
As I will soon be completing my term as AIB President, while remaining a member of the Executive Board, I thought it would be useful to review the progress AIB has achieved over the past year and what remains to be done.
Only a few readers of this blog are members of the AIB. Nevertheless, some other readers may be interested in my remarks delivered at the 2022 Annual AIB Meeting in Miami this past July, which include comments about the future of globalization in the conclusion.
The AIB membership consists of 3,400 academics (and a number of consultants) around the world involved in the study and teaching of International Business (IB). The AIB functions as the most logical network hub, or interchange, for the confluence of ideas from academics based in different functional areas from Marketing to Finance to Strategy to Political Science to Supply Chain Management. The AIB is the preeminent forum for this cross-fertilization of ideas, and the Journal of International Business Studies (JIBS) is recognized as one of the top academic journals in the field of Business Management.
Below is a summary of AIB’s 2021‒2022 activities. Readers can also view the slides I presented at the July 2022 AIB conference (see copyright below).
Let me emphasize: This report is based on the collective achievement of nine board members and literally hundreds of member volunteers, as noted below.
WHAT HAS BEEN ACHIEVED
Reorganization of Some Chapters – From National to Regional
The motivations for reorganizing were to:
(1) avoid duplication,
(2) prevent “capture” of AIB chapters by some countries’ national academic bodies and national interests,
(3) spur creative cross-fertilization of ideas across a region with business and cultural commonalities, and
(4) encourage rotation in office.
New Shared Interest Groups (SIGs)
SIGs are subgroups of members focusing on specific themes, such as Emerging Markets (Helena Barnard, Kristin Brandl, and others) and Sustainability (John Dilyard, Shasha Zhao, and others). SIGs also provide expertise by conducting special seminars.
Launch of the AIB-CIBER Doctoral Academy
An initiative germinated by Tamer Cavusgil and Aušrinė Šilenskytė, the AIB will collaborate in a partnership with 8 CIBERS (Centers for International Business Research & Education, funded by the US Department of Education) to provide training to a global set of doctoral students on topics such as:
- IB theory and empirics
- IB pedagogy
- IB content in “functional” areas, such as Finance and Marketing
- Region-specific IB modules
A two-year training program may be implemented at the end of which an “IB Completion Certificate” can be earned.
Other Progress (Thank You, COVID!)
The lockdown has happily spurred dozens of volunteers to launch new initiatives. For example, we’ve seen an explosion in online webinars offered by AIB members, SIGs, and chapters, to mention only a few.
Examples include a JIBS webinar series (started by Klaus Meyer and Tim Devinney), as well as an Emerging Scholars from Emerging Markets Program (ESEMP) led by the Emerging Markets SIG, with special thanks to the Center for Emerging Markets at Northeastern University (Ravi Ramamurti) and the Sheth Foundation (Jagdish Sheth).
Webinars are also being offered by the Asia-Pacific Chapter, the South Asia Chapter, and the Teaching and Education SIG.
Stronger Relationship with UNCTAD
AIB is committed to strengthening its relationship with UNCTAD under the leadership of James Zhan, Director of Investment and Enterprise, United Nations.
This mutually beneficial partnership can add academic expertise to UNCTAD, while at the same time providing legitimacy for the AIB in larger domains, such as:
- Economic development
- Supply chains
- Political science
- International tax avoidance
Continued Strong Progress of Our Three Journals
Our three AIB journals, superbly overseen by Anne Hoekman, Managing Editor, have continued to gain impact:
(1) Journal of International Business Studies (JIBS)
(Alain Verbeke, Editor-in-Chief [EIC], and his outstanding editorial team)
(Rosalie Tung, incoming EIC)
Highlights: 1.2 million downloads / 2-Year Impact Factor 11.38 / CiteScore 15.1
(2) Journal of International Business Policy
(Sarianna Lundan and Ari Van Assche)
Highlights: CiteScore 11.8 / Scopus searchable / ESCI
(3) AIB Insights
(Bill Newburry and Beth Rose)
More Areas of Progress
Strengthened Connection with “Functional” Areas:
- International Marketing (Gary Knight and Kelly Hewitt), Sheth Foundation
- International Finance (Chuck Kwok, Omrane Guedhami, and April Knill)
Special Focus “Frontier” Conferences ‒ Suggested Focused Conference Topics:
- Sustainability and global supply chains (already planned for October 2022)
- FDI determinants
- International HRM
- International tax avoidance
- Transfer of capability via international alliances
- Cross-border transfers of intellectual assets
WHAT STILL NEEDS TO BE DONE
The AIB needs to further convince deans in North America and accrediting bodies about the value of International Business as a field of study.
In emerging nations, the AIB needs to mentor/train doctoral students and junior faculty in these areas:
- Introducing an International Business course
- Including IB modules in “functional” areas, such as Marketing and Finance
- Upgrading research methods skills
- Understanding what it takes to publish an academic article
LOOKING TO THE FUTURE OF GLOBALIZATION
In conclusion, let’s look at a list of critical factors that will require continued focus and effort as we enter the future of IB:
- The multinational enterprise (MNE) will continue to play an indispensable role as a bridging agent, transmission channel, aggregator, and transferor of technology and best practices in a fragmented world.
- Globalization indicators have already recovered from the pandemic recession. The “new normal” for the future will not be dramatically different from 2019, except in some aspects, as mentioned below.
- Global coordination will be even more important for collective action to meet future pandemics, climate change, emerging technologies, and international tax-avoidance; to set common product and technical standards; and to address the growing sensitivity of customers worldwide to sustainability, ethics, and CSR issues.
- Taking a 30-year backward look, all three classic methods of IB have grown at a faster rate than the average growth rate of the average country’s GDP:
(1) Sales by foreign affiliates of multinationals (1990‒2019: 6.37% CAGR)
(2) Export sales of all nations (1990‒2019: 6.62% CAGR)
(3) Foreign sales achieved by foreign alliance partners via cross-border licensing of intellectual property (1990‒2019: 10.13% CAGR)
- In 2022, with its invasions, famines, uneven international supply chains, and other disruptions, we are in a new environment of heightened risk perception.
- The global manager knows how to manage risk. But the manager’s new task is to more critically assess the tradeoff between efficiency/cost reduction on the one hand (one of globalization’s driving factors in the past 30 years) and, on the other hand, resilience or risk-reduction (which is the new focus post-2022).
- For international supply chains, a small increase in inventories at point-of-demand, and/or shrinkage in geographical and cultural distance, and/or diversification of sourcing can slightly increase procurement costs per unit.
- But the higher international supply chain costs can be moderated by implementing better information-gathering systems, 5G surveillance and monitoring, blockchain, better integration of vendor–buyer computer systems, AI-based demand and inventory prediction, relationship-based alliances, and the continuing evolution and consensus on common technical and governance standards.
- Economic interdependence and Chinese pragmatism may limit the degree of decoupling between the US and China.
- In certain technologies, a bad example has been set already in terms of US-China decoupling ‒ an unfortunate bifurcation of technical standards in 5G communications.
- However, overall, the “Brussels Effect” is likely to also play a powerful, albeit quiet, role in shaping global commerce. That is to say, EU standards tend to be followed and adopted by many other nations and can become a global standard. For example, EU rules and standards are copied and adopted around the world on issues ranging from green technology, data protection (GDPR), antitrust and competition rules, ethics, international law, and arbitration. Technical standards exert a disproportionate extraterritorial influence leading to “harmonization” and, for multinational companies and traders, a lower-risk strategic planning environment.
- We are building a global technological civilization. This does not necessarily mean a convergence of cultures or language. It does mean common technical standards and commonly accepted rules of commerce and international conduct. It means thus far unprecedented levels of intergovernmental cooperation to confront the challenges facing all humankind, ranging from climate change, pandemic management, and cooperation in common areas such as the oceans and outer space.
- Darwin was less than half correct. The story of life – whether it be trees, fauna, or humans – is much more about cooperation than competition.
There are no guarantees that the common global achievements of the last 75 years will continue; history has seen many U-turns. But this is where we hope to go in our quest to build a global, technological civilization.